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Irish Consumer Spending Muted In August

18/09/2019

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  • Household spending increases marginally during August (+0.4% on the year)
  • Face-to-Face expenditure rises for first time in four months (+0.3%)
  • Hotels, Restaurants & Bars leads growth in August (+5.0%)

Dublin, September 18 2019: Visa’s Irish Consumer Spending Index, produced by IHS Markit, which measures expenditure across all payment types (cash, cheques and electronic payments), pointed to a marginal rise in expenditure year-on-year in August, thereby ending a three-month sequence of decline. Spending was up +0.4%, cancelling out a -0.3% reduction in July. That said, the slight rate of growth still represented subdued consumer spending trends relative to the five-year series history.

Both eCommerce and Face-to-Face expenditure increased during August, the first time that this has been the case since April. Spending on the high street was up +0.3% year-on-year, a marginal rise but one that was indicative of a first improvement in expenditure in four months.

The rate of expansion in eCommerce spending was also slight in August (+0.7% year-on-year), and slower than that recorded in July. Online expenditure has now risen in two successive months following a marginal decline in June.

All but two of the eight monitored sectors saw spending increase on an annual basis in August. Growth was led by the Hotels, Restaurants & Bars category where expenditure was up +5.0%, a stronger expansion than in July.

Solid increases were also recorded in the Health & Education (+4.1%) and Household Goods (+4.0%) categories. Food & Drink, meanwhile, posted a return to growth in August, with a rise of +2.7% year-on-year ending a three-month sequence of decline.

Modest increases in expenditure were seen in the Recreation & Culture (+1.4%) and Transport & Communication (+0.7%) sectors. Meanwhile, reductions in spend were registered in Clothing & Footwear (-2.6%) and Miscellaneous Goods & Services (-5.4%.)

Read Visa's Irish Consumer Spending August 2019

Philip Konopik, Ireland Country Manager, Visa said:

“Irish consumer spending remains flat, but there was a number of positive developments this month. August ended a negative three-month sequence for Face-to-Face merchants, with a +0.3% year-on-year rise representing the first increase since April. Similarly, the majority of sectors saw growth, with Hotels, Restaurants & Bars standing out as the top performer with a +5.0% rise in spending.”

Andrew Harker, Associate Director at IHS Markit said:

“Spending trends remained muted in Ireland during August, with a marginal rise in household expenditure cancelling out a similarly-sized fall seen in July. Consumers appear to be operating a wait-and-see approach at present, with uncertainty around the final outcome of Brexit still prevalent. The signs are, however, that households are becoming more worried about spending, with consumer confidence at a near five-year low. There was some positive news for the high street, however, with spending there up for the first time in four months.”